A HAULAGE boss has failed in a bid to get £215,000 of suspected drugs money back from the police, despite his arrest being ruled unlawful by three appeal judges.

The cash was seized from Charles McAughey, 53, three years ago as part of a probe into a £1million cocaine ring, codenamed Operation Chilon.

But the Crown Office last night insisted that they do not have to hand the money back – yet.

They said: “We note the decision of the court.

“The money referred to is now subject to confiscation proceedings in relation to another accused.”

McAughey had been due to stand trial along with five other suspects, including drugs kingpin David “Mincey" McKenzie, but the judges’ ruling last week means he no longer faces any charges.

His lawyers argued that evidence relating to the search of a lorry where the money was found was wrongly obtained by the police.

Kirimar Transport – McAughey’s haulage firm in Uddingston, Lanarkshire – had been under surveillance by the Scottish Crime and Drug Enforcement Agency in November 2010. They had information that McAughey was part of a gang ferrying money and drugs to England.

He was later seen transfering a bulky holdall from his office to a vehicle then a lorry before driving south.

The SCDEA then arranged for local traffic officers to stop McAughey’s lorry on the M74 near Lockerbie.

They were told the truck was thought to be carrying drugs and money.

McAughey was stopped and later charged with attempting to remove £215,800 from Scotland to pay for drugs.

But he claimed the traffic officers did not have reasonable grounds to suspect he was carrying drugs and both the money seizure and his arrest were therefore unlawful.

McAughey was previously linked to the biggest coke bust in French history.

Customs officers who stopped one of his trucks in Montpellier, France, in 2009 found 684kg of cocaine worth £31million and arrested two truckers employed by McAughey.

The men – Kenneth Ross, 57, from Mansewood, Glasgow, and James Davidson, 48, from Yoker – were only allowed home last year after spending three years in a French jail.

The drug haul in August 2009.

Explaining the decision of the three appeal judges, Lord Glennie stated: “Although the officer concerned was given reason to know that the SCDEA suspected that the vehicle was carrying drugs and money, he was given no factual information on which he could form his own view. For those reasons we consider that there was an insufficient basis for any suspicion.”

SCDEA officers also searched McAughey’s £1.5million home in Bothwell as part of Operation Chilon.

His home was one of 11 targeted by officers, who seized a further £40,000, 21 laptops and 60 mobile phones.

Jewellery, watches, shoes and paintings were also confiscated under proceeds of-crime laws.

McKenzie, 43, from Glasgow, was jailed for six years and eight months after a High Court trial in September.

He admitted being concerned in the supply of cocaine in Glasgow and a street in Uddingston.

McKenzie had twice previously been jailed on cocaine charges. He has links to crime boss Jamie Stevenson, who was jailed in 2007 for laundering £1million of drugs cash,

In 2011, McAughey was stripped of his operator’s licence after a lengthy probe by the Traffic Commissioner.

John Pryde solicitors, who were acting for McAughey, declined to comment. Police Scotland also would not comment on the case.